The Four Principles of an Enforceable Contract II

What is the importance of consideration? 

Consideration is the exchange of something of value, even if it is not adequate, which is why sometimes there is the concept of the peppercorn rent (an example being including a 1p fee in a contract, purely to satisfy the consideration requirement of contracts). The parties can decide whatever consideration they want. In the sale of a car, the payment of money by the buyer is considered consideration for the promise of the car, delivery of the car by the seller is consideration for the promise of the buyer to pay the seller of the car. 

What is the importance of the intention to create legal relations?

To make a contract, there has to be an intention. If no intention can be shown between the parties, there will be no contract. The criteria that the court has to look at this are to apply an objective test to ask whether reasonable people would regard the agreement as legally binding. 

An intention to create legal relations is presumed to exist in transactions carried out in the course of business between two commercial organisations.